Page 9 - AfrOil Week 14 2021

AfrOil INVESTMENT AfrOil

Chinese lending to Africa not transparent

REGIONAL BETWEEN 2000 and 2018, Chinese lending countries have accused Beijing, the continent’s
to Africa has been consistently above $10bn largest trading partner, of putting African econ-
per year between 2012 and 2017, with a peak of omies in a debt trap.
$30mn in 2016, with infrastructure being the French President Emmanuel Macron said in
dominant sector. February that “there is no point in restructuring
China is by far the biggest non-Paris Club African debts to Europe and the United States if
creditor in Africa, the African Economic Out- it is to contract more debts from China [...] What
look said recently. However, the report warned we have nevertheless very often seen done, in
that the African Development Bank (AfDB) recent years.”
judged that a large majority of these loans were Macron was referring to the results of the
not transparent. HIPC (Heavily Indebted Poor Countries) initi-
“The number of Non-Paris Club creditors in ative launched between the end of the 1990s and
Africa’s creditor landscape has been increasing, the beginning of the 2000s to cancel the debts
by far the most important being China. Many of several African countries, and which led to
of these loans are not transparent regarding a new round of massive indebtedness to China.
loan terms and collateralisation,” the AfDB said, Paris and the AfDB seem to agree that any
stressing that “most of the countries currently meaningful restructuring or resolution of Afri-
in debt distress or classified as being at high risk can countries’ debt would require negotiations
of debt distress have high exposure to Chinese with official Paris Club lenders and other coun-
loans.” tries, such as China.
Examples are Djibouti, where 57% of the However, bringing in China to such debt
total debt is held by Beijing, Angola (49%), the talks is likely to be difficult.
Republic of Congo (45%), Cameroon (32%), In recent years, the volume of loans dis-
Ethiopia (32%), Kenya (27%) and Zambia bursed by China each year seems to be declin-
(26%). ing. According to the AfDB, which takes into
This report comes as the debt issue is at the account the China-Africa Research Initiative
heart of African countries’ concerns. In this con- at John Hopkins University’s SAIS, since peak-
text, they are seeking financial resources to get ing in 2016, Chinese lending has fallen back to
out of the economic crisis caused by the corona- nearly $15bn in 2017 and then below $10bn in
virus (COVID-19). For several years, Western 2018. ™

PERFORMANCE
Libya eyeing to raise crude oil

output to 1.45mn bpd by year-end

LIBYA LIBYA’S ability to raise crude output from the
current 1.3mn barrels per day to 1.45mn bpd
by the end of the year depends on government
funding to state-owned National Oil Company
(NOC) and improved security in the country,
according to NOC chairman Mustafa Sanalla.
Libyan output has rebounded rapidly since
September 2021, when forces allied with Khal-
ifa Haftar’s Libyan National Army (LNA) ended
their nine-month blockade of the country’s
fields and ports. Nevertheless, Sanalla has out- Libya is now producing 1.3mn bpd of oil (Photo: Waha Oil Co.)
lined plans to raise production to 2.1mn bpd
within three to four years, as new oil fields in the Libya’s oil output has risen against the back-
central Sirte and western Ghadames basin come drop of renewed UN-led efforts to unify the
on stream and older fields that were damaged Tripoli-based Government of National Accord
during last year’s fighting are rehabilitated. (GNA) and LNA, its rival in the east.

Week 14 07•April•2021 www. NEWSBASE .com P9